Australian Mines Limited - Strong share price results in convertible note conversion
Australian Mines has triggered the mandatory conversion of the recently issued convertible notes (subject to shareholder approval) following the recent strength of the Company’s share price. The mandatory conversion date was defined as the date when the Australian Mines’ share price closed at $0.012 or above for any 20 consecutive trading days. The zero-coupon unsecured notes were issued at a price of $0.008 on 20 February 2017 and raised $3,803,310.
HIGHLIGHTS
- Australian Mines’ sustained share price increase triggers mandatory conversion of notes issued on 20 February in the earliest possible timeframe
- Australian Mines’ Flemington ore body represents the continuation of Clean TeQ’s Syerston deposit
- Market capitalisation of Australian Mines still only 10% of Clean TeQ
- Australian Mines’ ‘world class’ Sconi Cobalt-Nickel-Scandium deposit in Queensland is fully permitted and ready for development
Australian Mines Managing Director, Benjamin Bell commented, “It is pleasing that the obligation for mandatory conversion of the convertible note issue has been achieved in the shortest possible space of time on the back of a sustained share price well above the $0.012 threshold.
“The funds raised through the convertible note issue have allowed Australian Mines to accelerate its strategy to produce premium cobalt sulphate and nickel sulphate products from its Sconi ore in addition to a high-quality scandium oxide, via its own demonstration processing plant which is scheduled to go into construction in the coming weeks.
“Australian Mines has a mining lease and all relevant approvals in place for a mining and processing operation at Sconi, where there are significant analogues with Clean TeQ’s Syerston project in terms of its known resource endowment, and geological and metallurgical characteristics.
“We have now opened dialogue with potential project financiers based on the strength of both the Sconi Pre-Feasibility Study completed by our joint venture partner Metallica Minerals and the recently completed Flemington Scoping Study. Whilst it is important to note that these discussions are at the early stages and there is no guarantee that they will result in funding agreements being finalised, nonetheless they have been highly encouraging.”
“We are also in the process of completing the Mining Lease application over the Flemington project and securing a water licence as part of our advance towards Pre-Feasibility stage.”
Australian Mines Limited (“Australian Mines” or “the Company”) is pleased to announce that the mandatory conversation of the recently issued convertible notes will occur, subject to shareholder approval, following the recent strength of the Company’s share price.
The mandatory conversion date was defined as the date when the Australian Mines’ share price closed at $0.012 or above for any 20 consecutive trading days(1). This has since been achieved in the earliest possible timeframe, with the Company’s share price up about 300% in the three-month period from 15 December 2016.
The zero-coupon unsecured notes were issued at a price of $0.008 on 20 February 2017 and raised $3,803,310.
Conversion of the convertible notes into Australian Mines shares is subject to shareholder approval at a General Meeting called for Tuesday 11 April 2017(2) . The further placement of 60,745,071 shares at an issue price of $0.008 per share to raise gross proceeds of $485,960 will also be subject to approval at the General Meeting. The Australian Mines Board recommends that shareholders vote in favour of all resolutions at the General Meeting, including the conversion of the convertible notes.
Australian Mines will use the funds raised to fast-track the development of its advanced Sconi Cobalt-Nickel-Scandium Project from which the company is intending to produce both a cobalt sulphate and nickel sulphate products as well as a scandium oxide powder, using industry standard off-the-shelf HPAL processing system that is proven to deliver battery grade cobalt and nickel sulphates to the growing electric vehicle market. Construction of an operating demonstration processing plant, which will have a foot print of approximately 500 square metres is scheduled to commence in early April 2017 with completion by October 2017.
Australian Mines will also use the funds from the convertible note issue to advance work on the Flemington Project in central New South Wales.
The ore body within the Company’s Flemington Project represents the continuation of Clean TeQ Holdings’ Syerston ore body, which shares a tenement boundary with the Flemington Project.
Australian Mines is proposing to commence a resource extension drill program at Flemington in the coming quarter, which is designed to further increase the Company’s cobalt and scandium resource as well as allow Australian Mines to confirm the project’s promising nickel potential.
Australian Mines would also remind shareholders that it is currently undertaking a fully underwritten, non-renounceable Entitlement Offer to raise approximately $2 million as announced on 21 February 2017. Completed applications need to be received by Advanced Share Registry by 5pm Melbourne Time on Friday 31 March 2017.
(1) Australian Mines Limited, Significant capital raising to fast-track the development of Australian Mines’ two core scandium - cobalt assets, release 21 February 2017
(2) Australian Mines Limited, Notice of General Meeting, released 10 March 2017
